Antitrust regulators on both sides of the Atlantic are tightening their grip on Big Tech companies, Reuters reports, raising concerns that breakup orders could be issued to industry giants such as Apple and Alphabet Inc.'s Google. ing.
Antitrust investigations are proliferating around the world following the launch of lawsuits by the European Union and the United States. The crackdown represents the most serious challenge for Big Tech since AT&T's breakup 40 years ago.
These lawsuits resulted in the company, then known as Mar-Vell, being split into seven independent companies known as “Baby Bells” in an effort to break up one of the most dominant monopolies of the 20th century. This reflects the 1984 breakup of AT&T. Currently, AT&T, Verizon, and Lumen are the remaining surviving companies.
Google and Apple defend the allegations
Google disputes the EU's claims, while Apple counters by arguing that the claims in the US lawsuit are factually and legally incorrect.
Regulators have accused companies like Apple and Google of building insurmountable barriers around their products, creating so-called “walled gardens” and preventing consumers from switching to alternative services. ing.
The U.S. Department of Justice has issued a warning to Apple, a company with a market capitalization of $2.7 trillion, suggesting that a breakup order remains an effective remedy to restore competition. This comes after the Justice Department joined with 15 states to sue Apple for monopolizing the smartphone market, inhibiting competition, and price gouging.
Meanwhile, Big Tech faces further scrutiny amid growing threats in Europe, with Apple, Metaplatform and Alphabet likely to be investigated for alleged breaches of the Digital Markets Act, leading to hefty fines and breakup orders. there is a possibility.
Antitrust Commissioner suggests drastic measures
EU antitrust chief Margrethe Vestager has proposed drastic measures to address anti-competitive practices, including potentially forcing Google to sell its ad tech business. A final decision is expected to be made by the end of the year.
European Parliament member Andreas Schwab calls for strong action against Big Tech to ensure open markets, fairness and foster innovation.
Despite the looming threat of a breakup order, it remains unclear whether regulators will pursue such drastic measures. Legal experts have suggested that the case against Apple could be more complex than past cases, such as the 1998 case against Microsoft.
Experts weigh potential remedies
Legal experts highlight the challenges of dismantling a highly integrated system like Apple's and suggest alternative behavioral remedies. Structural remedies such as separation are likely to be subject to intense legal scrutiny.
Apple derives the majority of its revenue from hardware sales, followed by its services business. Any structural relief measures will undoubtedly impact revenue streams.
Legal experts also expect a protracted legal battle if structural remedies are pursued, warning of the complexities and challenges involved.
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